Question
1. You collect the following production data for your firm: Q 192 2 955 6 506 3 67 1 1,060 9 860 5 1,128 7
1. You collect the following production data for your firm:
Q | |
192 | 2 |
955 | 6 |
506 | 3 |
67 | 1 |
1,060 | 9 |
860 | 5 |
1,128 | 7 |
688 | 4 |
629 | 11 |
929 | 10 |
a. Which functional form (linear, quadratic, cubic) is most suitable to your data? Construct a scatter diagram but be sure to just do the dots; don't include the lines that connect them. Then, play around with the trendline feature and include what you consider to be the best trendline. b. Using OLS, estimate the firm's short-run production function. Comment on the strength of the regression results. c. Calculate the Q, AP, and MP for L = 8 workers. d. At 8 workers, is MC rising or falling, and how do you know?
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